Cipla Q3 earnings: Net profit drops 57% to ₹676 crore, EBITDA shrinks 37%, margins contract by 1,040 basis points

Cipla, the country's leading drug maker on Friday, January 23, reported a sharp decline in its net profit in the third quarter of the current financial year on account of one-time exceptional loss of ₹276 crore on account of implementation of new labour codes. Cipla's net profit in December quarter dropped 57% to ₹676 crore from ₹1,570 crore in the same period last year.

The company said that manufacturing of Lanreotide is temporarily paused following USFDA observations at its partner Pharmathen’s facility and gRevlimid had a small contribution in US revenues this quarter, Cipla said in an investor presentation.

Cipla’s revenue from operations rose marginally to ₹7,074 crore in the October-December period from ₹7,073 crore in the corresponding period last year.

Cipla reported weak operational performance as its EBITDA (earnings before interest, taxes, depreciation and amortization) also known as operating profit dropped 37% to ₹1,255 crore and its EBITDA margin contracted by 1,040 basis points to 17.7%.

Cipla earned $167 million in revenue from the North American market.

"The North America business delivered a quarterly revenue of $167 million. Albuterol ranked No. 1 in the overall US Albuterol MDI market, with a 22% market share. The FY27 pipeline includes four major respiratory launches, including gAdvair. During the quarter, the business will launch gVictoza and further expect to launch 3 more peptide assets in FY27. Three of the four respiratory assets are filed from US facilities," Cipla said.

"Deep market focus strategy in Emerging Markets and Europe has laid a solid foundation, with the business delivering a growth of 7% YoY in USD terms with an uptick in both DTM and B2B categories, along with sustained overall margins," Cipla added.

Cipla's Nicotex, Omnigel and Cipladine maintained leadership positions in their respective market segments. The business is driving healthy secondary growth and actively exploring opportunities to invest in products and channels to further expand our distribution network, Cipla said.

“In Q3FY26, we delivered global revenues of INR 7,074 Cr, despite the known drop in gRevlimid sales. Our OneIndia business grew at solid 10% YoY. Branded Prescription business delivered a double-digit growth, with key therapies outpacing the market, Trade Generics recorded healthy growth and Anchor brands of Consumer Health Business maintained leadership position,” said Achin Gupta, MD and Global CEO (Designate), Cipla.

Cipla shares fell as much as 4.92% to hit an intraday low of ₹1,303 following its earnings announcement. The stock was massively underperforming the NIFTY50 index which was down 0.9%.